Samsung's Silicon Valley Home

Samsung is building a 10-story complex in the heart of Silicon Valley that will be home for some of its memory and display researchers and a whole lot of ecosystem efforts.

SAN FRANCISCO — Across town from the big mound of dirt where contractors are starting work on Apple's new circular headquarters, Samsung is building its own high-tech temple. In a press reception here, a handful of execs outlined plans for memory and display R&D there.

These big construction projects are monuments to the fact that Silicon Valley remains one of the hot global hubs in the electronics business. Like so many other companies, Samsung wants to tap into the top-drawer pool of component, system, and semiconductor talent here -- and, of course, a lot of angel and VC investors.

Since 2012, the executives said, most of Samsung's employees have worked outside Korea (190,000 of 286,000 last year). But some of the brightest lights are still in and around Seoul. For instance, even though the San Jose display lab headed by Brian Berkeley will take the lead for issues like user experience, interfaces and formats, and driver electronics, the core display technology remains back at home base.

Interestingly, Berkeley said the emerging OLED technology now accounts for 29% of all mobile displays (by dollars, I assume) and was a $10 billion business last year. Prices are still high, keeping OLEDs from reaching their full potential in TVs, he said, but yields for the displays are on the rise.

Samsung's new San Jose building will sport a sandwich of green between and around its 10 office floors.

The memory lab is headed Bob Brennan, a smart-as-a-whip system architect. But he tips his hat to the geniuses back in Korea who have been hammering out technologies like vertical NAND flash and new ways to scale DRAM.

Most of Samsung's chip development is in Korea, too, though it has a growing team near its fab in Austin. Interestingly, several sources said Samsung had an ARM server SoC project in Silicon Valley, but it was cancelled recently when the customer, a big local datacenter (Google? Facebook?), opted out of the project.

I asked Hong Hao, a newly named senior vice president of Samsung's foundry business, about the ARM server project after he told me he used to run an SoC program in San Jose. He just smiled broadly and said he couldn't comment on rumors.

Hao showed a chart of Samsung's foundry offerings. It consists of three flavors of 28nm offerings (maybe more to come) and two of the 14nm FinFET variety. The missing planar 20nm node is one Samsung supposedly keeps only for internal use.

It will be interesting to see who gets to a 16/14nm FinFET node next -- Samsung and its partner Globalfoundries or TSMC. Though TSMC is reportedly getting the Apple iPhone 6 chip business, the Samsung/GloFo deal was supposedly motivated to get big deals from companies such as Qualcomm. Of course, Intel will beat all of them; it is expected to start making its x86 chips at 14 nm late this year after many delays.

This is clearly an industry of fewer, bigger players cultivating expanding ecosystems and making fewer, bigger bets.

Someday visitors will probably be able to see Intel's headquarters from the top of the new Samsung building, but that new "spaceship" Apple is building will be just beyond the horizon -- and appropriately, so given the inscrutably secretive company it is.

I remember discussions on SemiWiki a year or two ago on 28nm yields at TSMC and there was even a guessing contest! I may be wrong on this but I think TSMC did not officially disclose their yields for 28nm nodes (or did so at a much later date).

In the absence of published data, I have seen horrible yield numbers speculated for 20nm nodes (10% to 30%) so one would think this will not get any better at 14nm. So it seems to me that the buzz on 14nm nodes is more a headline-garnering topic than a viable business one!

Ummmm, Chang said something about orders on 16nm in 2015. Still he does not say that Apple or Qualcomm have cancelled ALL 16nm orders on TSMC, moreover he say that TSMC will be a lot better in 2016 and 2017 on this node; in short words in 2015 Chang will give to customers all the capacity TSMC have decided to dedicate to 16nm for economic reasons.

Now, i think nobody knows the real story. I have the suspect about a mid 2015 nearly risk production at Samsung just to satisfy Apple and my bet is in an Apple multi-foundry approach in 2016. About Qualcomm, it will be on TSMC 20nm in 2015 so i think that TSMC will not lose much on 16nm node with this firm. Another variable is that Samsung has not enough wafer capacity so again i can't see many problems for TSMC, it is growing in revenue so well doing the devices on the more yielding process availabe at the moment, without doing strange push in hardcore spaces.

But the story has another downside.

I don't see winners here. The real winner is the foundry capable to deliver devices on a node at the higher gross margin. Samsung want to rush?? ok! still i can't see much net profit here but only an useless red flag to make expensive competition to the MUCH bigger TSMC foundry asset. I fully agreed this is an attempt to have a stronger relevance in foundry world but without a multiyears experience in FinFet lithographic design, all this could end in a sad story.

This is the reason Intel has delayed 14nm. Broadwell was ready in Q1/2014, Intel was capable to manufacture it at the beginning of this year. Still a 60/70% yield level does not fit with Intel business model......so better wait another year, the very low power 22nm FinFet process is good enough in a world in which ALL foundries have huge delay and 28/20nm will are the bulk of the volume production for others two years from now.